Federal Employees’ Health Benefits Explained

What is the Federal Employees Health Benefits Program and who is eligible?

The Federal Employees Health Benefits Program (FEHBP) is the “marketplace” for full-time government employees and qualified retirees to select health and dental insurance offered by insurance companies and employee associations. The federal government is the largest employer in the country and more than 8 million people – including current employees, retirees, their spouses, dependents and survivors – are enrolled in FEHBP.

More on Federal Employees’ Health Benefits

Customers enjoy a wide range of insurance options, from catastrophic coverage plans with high deductibles to health maintenance organizations to high-end plans with many choices of doctors. Last year, the combined total of plans offered around the country totalled 269. While the number of choices for individual workers varies, based on their geographic location, everybody has a choice of at least 10 fee-for-service plans.

FEHBP provides coverage without regard to pre-existing conditions or age. There are no waiting periods for coverage.

How much do plans cost?

The most common plan, the Blue Cross Blue Shield Standard option for federal workers, set deductibles this year at $300 for individuals and $600 for families. It limits out-of-pocket expenses to $5,000 per family for services from preferred health care providers and $7,000 overall.

On average, the government pays 72 percent of premiums.

The monthly cost to the worker for the Blue Cross Blue Shield Standard plan is $152.06 for an individual and $356.59 for a family.

How will the overhaul proposals affect people in FEHBP?

There is little that would change for FEHBP participants if a Democratic reform proposal were to pass. Most FEHBP recipients would not be affected by the minimum benefit standards expected in the bills because their benefits already meet those standards.

If there are taxes on health plans, as some lawmakers have proposed, people with FEHBP would face the same taxes as those in other plans.

While health reform bills would set up a Health Insurance Exchange or Gateway to provide a marketplace for individuals and businesses to buy coverage, the current proposals would generally restrict FEHBP consumers – or other people with employer-sponsored insurance – from using such an exchange.